The 25-year-old from Ukraine is currently due to become a free agent at the end of the season, meaning that he is free to open talks with foreign clubs from January onwards, and he affirmed in July that the ball was in Real Madrid's court regarding a new deal.
Lunin deputised well for the stricken Thibaut Courtois during the Belgian's absence with an ACL injury last season, largely fending off Chelsea loanee Kepa Arrizabalaga for the gloves before dropping back down to the bench when Courtois returned.
The Ukraine international's eye-catching feats last term led to suggestions that he could leave in search of the number one spot elsewhere, but according to Fabrizio Romano, he has chosen to stay in Madrid.
The transfer expert reports that Lunin and Real Madrid have shaken hands on a three-year extension to his current contract, which will keep him at the Bernabeu until the end of the 2027-28 season.
Lunin signs new Madrid deal despite Champions League snub
Confirmation of Lunin's new contract is set to arrive in the not-so-distant future, and he will have completed a decade of service to Los Blancos should he stay for the full length of his deal.
The 25-year-old joined Real's ranks for €8.5m (£7.2m) from Zorya Luhansk in 2018 and was loaned out three times - to Real Oviedo, Real Valladolid and Leganes - before making his first-team breakthrough.
Lunin has never risen to first-choice status in the Spanish capital, though, making just 48 appearances for Los Blancos in all tournaments, 31 of which came in the 2023-24 campaign.
The Ukrainian received high praise for his performances in Courtois's absence, but despite playing every minute of Real's Champions League knockout stage campaign up to the final, he was dropped for Courtois in the 2-0 win over Borussia Dortmund.
Lunin was also guilty of a poor display in Ukraine's 3-0 loss to Romania in their Euro 2024 opener, which saw him dropped for the Blue and Yellow's subsequent meetings with Belgium and Slovakia.
Which clubs were interested in Lunin?
Despite his forgettable Euro 2024 experience, Lunin was thought to have been on the radar of three revered Premier League sides, including Arsenal, who sold Aaron Ramsdale to Southampton this summer.
The Ukrainian would have never demoted David Raya to second choice in North London, though, and the Gunners signed Neto on loan from Bournemouth instead, but they could re-enter the goalkeeping market in 2025.
Chelsea were also rumoured to have been targeting Lunin for their goalkeeping department, before casting their eyes over to Villarreal and capturing Filip Jorgensen as an alternative.
The third and final Premier League club to have been credited with an interest in Lunin - Liverpool - also turned their attention to another La Liga goalkeeper, signing Valencia's Giorgi Mamardashvili.
Lunin has not played a single minute for Real Madrid so far this season, and his chances of eventually succeeding Courtois may have suffered another blow, as Los Blancos are reported to be running the rule over a more experienced shot-stopper as the Belgian's possible replacement.